Blue note from yellow pages owner

Shares in classified advertising directory Yell fell more than 26% as it halved its annual dividend and gave a bleak economic outlook for the year.

The publisher of Yellow pages in the UK and Yellow Book directories in the US warned that tough conditions would continue for the rest of the year.

Yell announced a 25.4% rise in pre-tax profit to £310m.

Chief executive John Condron said the firm saw no let up in the economic pressures "during the current year".

But he added: "However, we will continue to invest in all our products, focusing in particular on the internet to reinforce the foundations for further growth."

We will continue to invest in all our products, focusing in particular on the internet to reinforce the foundations for further growth John Condron, Yell See Yell's share price

Meanwhile UK revenues grew by 1.7%, below the previous forecast of 2% in February.

The value of Yell shares has tumbled by two-thirds over the past 12 months as competition from Internet search engines intensifies and businesses cut back on their advertising spend.

Its shares closed down 26% at 154 pence.